Umbrella Company Employees and other skilled freelancers in the UK are being passed over for projects they are perfectly capable of undertaking because of the abuse of intra-company transfers (ICTs) via large offshore Umbrella Companies, says the PCG.

The PCG’s director of public affairs, Simon McVicker, has written to senior politicians to highlight the abuse and has recently contributed to a consultation from the Home Office concerning the degree of influence the UK has in relation to the EU over immigration.

International trade agreements, Mr McVicker argues, limit the UK’s control over immigration policy, with the result that ICTs can be misused by companies to discriminate against the UK’s home-grown contracting community. He explains: “We believe large, offshore outsourcing companies are able to pay little or no tax on ICT workers due to complicated rules surrounding tax-free allowances. We have used a consultation on the issue of ‘offshore employment intermediaries’ to express our significant concern about the issue of ICT abuse, amongst a number of other areas of concern for freelancers.”

Mr McVicker endorsed the recently expressed sentiments of Michael Hancock, the skills minister at the BIS, who said that UK companies have a social duty to recruit home-grown talent before looking elsewhere for staff. Unfortunately, the misuse of ICT work permits means that this obligation can be easily dodged.

Mr McVicker cited the example of the Student Loan Company (SLC), which is part of BIS and has used ICT workers supplied by large offshore intermediaries. The skills required for these roles are not in short supply in the UK’s own contractor community, so there is no reason for the SLC to resort to this method, he said.

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